Cantor Fitzgerald and CIM Group (CIM) formed Cantor Commercial Real Estate (CCRE), a real estate financing business that will originate fixed- and floating-rate mortgages and mezzanine loans backed by diverse real estate assets located mainly in the urban areas of major U.S. markets. The newly formed firm will engage in securitizations of these loans.
Cantor and CIM will serve as co-general partners. The CCRE management team is led by Anthony Orso, executive managing director of Cantor Fitzgerald and chief executive officer of CCRE.
While over $230 billion in CMBS were originated in the U.S. at the peak of the CMBS market in 2007, the aggregate supply of originations dipped significantly to about $3 billion in 2009. CCRE thinks that the market is set to become more active, as U.S. commercial property values start to stabilize and since it is expected that borrowers will need to refinance around $1.4 trillion of CRE debt maturing over the next four to five years.
“We have put together one of the preeminent real estate financing teams in the business,” said Howard W. Lutnick, Cantor chairman and chief executive officer. “And with our partner, we have created an exciting new platform in the CMBS origination and structuring business, something that was traditionally kept in-house by Wall Street. It’s a defining moment in commercial real estate lending.”
“By partnering with CIM, an outstanding investor, we are creating an entirely new investment banking model in the commercial mortgage business and are initially targeting annualized loan production of approximately $5 billion,” Orso said.
He added that Cantor's strategic partnership with CIM Group will contribute to renewed liquidity for senior debt instruments. “CCRE’s powerful institutional sponsorship and capital base, combined with the strength of Cantor’s fixed income sales force and the depth of its borrower relationships, are the foundation of our capability to offer superior capital markets execution and a diverse distribution strategy," he said. "The fundamental quality of assets, credit quality of borrowers, and high standards in loan structures will be the hallmark of our transactions as we make loans and launch securitizations.”
Orso also said that current market conditions offer a considerable opportunity to build a vibrant role for CCRE in the commercial real estate financing marketplace.